Tag Archives: Mike Salguero

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Choose the right stakeholders: Why we never took outside investment

There are lots of different stakeholders involved in ButcherBox that play crucial roles in bringing delicious steaks or pasture-raised bacon to your plate.

There’s the farmer.

There are the facilities that are cutting the meat into individual steaks.

There is our growing number of employees, and there are all our members — whom we consider to be the vital part of our community.

The ecosystem involved in getting our boxes to the doorsteps of our members is quite robust.

From the start, we wanted to make sure that everyone in that ecosystem was getting an amazing experience. For some, like the farmers, we wanted to make sure that they can run a business and that they view our relationship as having high-value beyond that of a standard business partnership.

For instance, it is vital that the farmers we work with are well-supported. We want them to have the opportunity to invite their children to take part in the same vocation and be confident that they can pass down their farm to the next generations. We want young farmers to be able to grow a business utilizing humane and environmentally beneficial techniques.

More than anything, we want our members to receive a great product at an amazing value. A key to that is also making sure that they can trust that we have done everything possible to source the highest-quality meat.

The ability to continue to do all the above is made possible by a decision my co-founder, Mike Filbey, and I made in the early days of ButcherBox.

Even before the success of our Kickstarter campaign, we wanted those mentioned above — farmers, the supply chain, employees, and ButcherBox members — to be the only stakeholders to whom we answer.

Because of that belief, we haven’t raised money from outside investors. It is quite amazing, in the current climate, what we’ve been able to accomplish without money from outside institutions, even as we hit a new phase of growth for the company or face some unexpected challenges.

In the past ten years, startups have become trendy. Entrepreneurship is now the number one concentration at many business schools. People really want to get into startups and build a company. And that’s really great.

I think the uptick in entrepreneurship is going to spur innovation in this country, help the industry in the nation grow in unimagined and positive ways, and bring incredible new services to lots of folks.

The challenge in the startup world right now, unfortunately, is that everyone who is building these companies is obsessed with raising money from venture capitalists.

I continually talk with people interested in starting their own business, seeking my advice, and, generally, all they want to know is how to go out and raise venture capital. I’ve found that there are very few people focused on actually building a company that is interesting, enduring, and profitable.

In the current climate, too many founders and executive teams have their focus on trying to figure out how to get the next round of funding from venture capitalists.

This is something pervasive in startup world. If you look at the major tech news outlets right now, almost every single article about early-stage companies is about how much money somebody sold a company for or how much somebody took from a VC. There’s no real depth, no exploration of companies doing cool things; no one is interested in companies that are actually making money.

ButcherBox started with a Kickstarter campaign and $10,000 that I took out of my personal investment account. At the time, I thought that if this venture doesn’t work out, it would be a great experience and that I’d hopefully learn some valuable lessons, things that couldn’t be taught at business school.

I was willing to risk that money to create ButcherBox, and that’s all we’ve done. We’ve never raised money. We don’t plan on raising money.

I like to tell people that we are building ButcherBox the old-fashioned way. But the reality is that we want to build this company our way. That means that we aren’t beholden to stakeholders that are only concerned about a return on their investment.

There might be — I should say — a couple of instances when getting money from a VC is a necessity. The only two examples I can think of are if you have cheaply and efficiently found product/market fit and need some money to scale, or if you are building a very tech-focused company that requires funds up-front to help you build your innovative product. Otherwise, I believe venture investments can be not only quite bad for a business, but also a massive waste of time for the team who should be focused on building a great business.

And while good investors can help, they could also try to change the vision of what ButcherBox can be. The minute you get venture backing, you also get an investor that has his or her own motivations.

That person might want want to focus on when and how you will make more money or have some concern about a trendy metric, and suddenly the idea of building an amazing company for our employees, for our members, and for our farmers could change.

The only way to build ButcherBox the right way — that we could keep total control, have an incredible product, and deliver an awesome experience — was not to raise money and to just make a go at this ourselves.

And so far, so good.

To this day, we only answer to our employees, to our farmers, and most importantly, to our community of ButcherBox members.

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Photo by Viktor Forgacs on Unsplash

Does grass-fed beef make you feel better?

There are numerous benefits to eating grass-fed meat that we have discovered or learned about over the years.

Beef from cattle raised and finished on grass — and some types of forage — is better for you mainly because the animal’s diet is healthier, as opposed to cattle which eat mostly corn and grain-based feed.  Additionally, cows that are allowed to graze — not raised on a feedlot — are generally treated more humanely and are typically not given feed that contains unnecessary antibiotics and hormones. If you want to go a step further, the use of regenerative farming practices by those raising grass-fed and finished cattle is believed to be better for the environment.

But there is another, underappreciated and less discussed advantage to eating grass-fed beef that we believe makes the experience far superior to the alternatives.

During one of the first discussions I had with ButcherBox founder and CEO Mike Salguero about his reasons for starting the company, he explained something that he had noticed since switching to a diet that included more grass-fed beef. After years of eating steaks and the like, he had become aware of a unique post-meal experience when eating grass-fed beef. 

He just felt…better.

For Mike, it was a feeling of lightness, of lacking a sense of the fullness and bloatedness that accompanied the consumption of non-grass-fed steaks in the past. These sentiments were supported by how he felt on the occasions when he had no choice but the eat a standard (or feedlot-raised) piece of beef. He told me how profound the contrast was eating non-grass-fed meat after spending long periods avoiding beef from cattle fattened up on a mostly corn-centric diet.

After one meeting at a highly-reputable steakhouse, Mike said that he could physically feel the differences. He was more tired, felt more gastrointestinal discomfort, and had a greater sense of tenseness and restlessness than he had experienced while eating grass-fed steaks. 

To Mike’s mind, this was due to the energy that the body needed to break down meat from cattle enriched with corn, versus that that was easier for the stomach to handle: Naturally-raised grass-fed cattle.

What Mike was trying to articulate is an argument that can be traced back to Michael Pollan’s writing in the New York Times and The Omnivore’s Dilemma.  According to Pollan, cows aren’t naturally suited to eating corn; in fact, he has explained in various articles and interviews, that a cow’s digestive system, specifically the “rumen,” cannot digest starchy corn as easily as it can grass, which it can also turn into protein. This, according to Pollan, can make cattle sick when they are weaned off grass, but is economically cheaper and leads to fatter cattle and more marbled beef.

“In the same way ruminants [like cows] have not evolved to eat grain, humans may not be well adapted to eating grain-fed animals,” Pollan wrote in 2002.

This point makes sense when you think about it: We evolved as meat-eaters who naturally consumed animals that, for centuries, millennia even, ate nothing other than grass (and similar plants). While humans as consumers have gotten used to the ways that the food industry can more quickly and cheaply “produce” beef, this development may not be in the best interest of our bodies and, specifically, our digestive systems.

This evolution-related theory is a big reason why grass-fed beef is so popular with Paleo dieters.

Digging into the literature on this topic is a bit of a challenge. While there is a great deal written on the nutritional differences between grass-fed and feedlot-raised cattle, there is significantly less examination about how our body reacts to the process of digesting the two. 

One author I discovered, Lily Nichols, who runs the website PilatesNutritionist.com, said that she’s noticed a difference among her clients with food sensitivities when they switch from grain- or corn-fed beef to grass-fed. According to this post, choosing grass-fed beef has helped reduce heartburn, bloating, and other digestive troubles among her clients.

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